(I) Settlement Method
Cross-border trade RMB settlement refers to the currency function of RMB in pricing and settlement in cross-border trade, that is, when import and export enterprises use RMB to price and make external payments in cross-border trade, commercial banks provide them with international settlement services using RMB as the cross-border settlement currency.
(II) Settlement Characteristics
(1) It avoids capital losses caused by exchange rate fluctuations in foreign trade and avoids exchange rate risks.
(2) It improves the effectiveness of corporate trade decisions and helps them focus on production operations.
(3) Enterprises no longer need to exchange currencies, which effectively reduces settlement costs.
(4) The currencies of corporate trade funds and production funds are the same, which can help companies manage cash more effectively.
(5) RMB settlement is simpler and more convenient. It is not included in the foreign debt quota management, which improves the settlement and financing efficiency of enterprises.
(III) Business Process
For the cross-border trade RMB settlement business process, please refer to the T/T remittance, documentary collection and L/C settlement business process.